French press review 08 January 2013
Tax and the economy are big issues again in today's papers..
Tax is attracting attention on the front pages of right-wing Le Figaro and communist L'Humanité. The points of view are, not too surprisingly, different.
Le Figaro says France is swimming against the European current. This is because the international financial consultants, Ernst & Young, have just published a report saying that most other developed countries tend to put the emphasis on sales tax, what we call VAT, rather than the French preference for direct taxation based on what people, and indeed companies, earn.
Le Figaro says that, at an average of 52%, France is the second toughest country in Europe in which to be well-heeled. Only Sweden treats its rich more harshly.
The right wing paper's editorial laments a situation which benefits France's neighbours, who happily accept the businesses and creative individuals driven away by socialist pig-headedness on the question of taxation.
L'Humanité says the recent rejection by the Constitutional Council of government plans to tax incomes over one million euros at the rate of 75% opens the door to a total overhaul of the French tax system. That reform will need, fundamentally, to close the various loopholes which allow the very rich and the very poor their one shared characteristic . . . neither group pays tax.
The rejection of the 75% tax proposal also raises questions about the political independence of the Constitutional Council. The council's job is to ensure that proposed laws are in line with the provisions of the national constitution.
But L'Humanité notes that all members of the current council were appointed by right-wing governments (three of the members are former right wing presidents), suggesting that the group of supposed sages is now functioning like an overly-politicised censor of parliamentary decisions.
Business daily Les Echos is worried about the property market. Prices are down, the number of transactions is in sharp decline, big investors are fleeing the luxury end of the rental business. The average cost of a square metre of living space is still close to 3,500 euros, nearly three times the 1995 price. Analysts say buyers are waiting for prices to come down even further.
Les Echos is also worried about the stock exchange. Last year was, once again and despite endless moaning about the crisis, a very good year for most of the top companies quoted on the Paris exchange. But fewer individual investors are risking their ill-gottens on the stock market. Over the last four years, the number of private investors has dropped from 14% to just 8% of the French population, a loss of two and a half million punters.